City of Powell River, along with three private companies, has been named a defendant in a Supreme Court of British Columbia notice of civil claim filed April 2 regarding the consolidated wastewater treatment plant project.
The lawsuit has been initiated by Graham Infrastructure LP, the main contractor for the wastewater plant in Townsite. According to the court document, place of trial will be in Powell River. Graham’s allegations have not been proven in court.
In the 34-page statement of claim, Graham was the successful bidder for construction of the plant, referred to in court documents as the C3 project. Later, Graham was also the successful bidder for the construction of conveyance lines and associated linear works to connect the plant with the various piping bringing wastewater to the plant. Court documents referred to this as the C4 project.
The court documents stated the city would pay Graham a lump sum of $56,045,662.65 plus GST for the C3 contract. For the C4 contract, the city was to pay a lump sum price of $7,639,670.88, plus GST, and unit prices for specified items for the C4 work, with an estimated value of $10,250,643.34, plus GST. The city was to pay all amounts due and owing to Graham on the C3 and C4 contract prices no later than 20 business days after the city received each of the payment certificates.
Court document state that Graham entered into the contracts and began the C3 and C4 work with reasonable assumptions that the projects were each fully designed, constructible and ready to be build. However, the design for the projects was not sufficiently developed, leading to significant changes to the scope of Graham’s work on the projects, according to the court document.
Graham’s performance of both the C3 and C4 work was characterized by repeated interruptions, delays and changes by the city to address under-designed elements of the project’s design, according to the lawsuit.
Graham alleges that in further breach of its contractual duty of good faith and honest performance, the city knowingly misled Graham by making repeated assurances to Graham that it would be treated fairly in respect of compensation for the C3 and C4 changes, and encouraged Graham to proceed with the changed work on the basis of those assurances in circumstances in which there was no advanced agreement on the total amount to be paid for directed changes.
After completion of the C3 and C4 changes, the city and Associated Engineering (AE), the city’s design firm, in breach of the C3 and C4 contracts, refused or neglected to reasonably consider Graham’s claims for compensation or extensions of time for carrying out that work despite that work largely having been directed by change directives issued by AE, stated the court document. AE has also been named in the suit, along with Koers and Associates Engineering and WSP Canada, which provided design as AE’s sub-consultants.
The result is that while the substantial volume of C3 and C4 work changes were completed by Graham, and the city obtained the benefit of such changes and Graham’s successful completion of the projects, Graham has yet to be properly compensated for its work, according to the statement of claim.
In addition to amounts owing on account of the C3 directive work, the C3 additional changes and the C3 delays, the sum of $721,502 remains due and owing from the city to Graham, according to the court document. Further, the sum of $702,657.23 remains due and owing from the city to Graham on account of the C4 contract price and the C4 work, Graham has suggested.
Regarding the claim of builders lien, Graham has made a claim of lien alleging that the sum of $19,370,124.32 was due and owing on September 12, 2023. Graham is also seeking judgment for general and special damages for breach of the C3 and C4 contracts and judgment for general and special damages for negligence.
City of Powell River chief administrative officer Lisa Bhopalsingh provided the following statement: “The City of Powell River is working through the appropriate legal channels to address claims, including the city’s claims, related to the community wastewater treatment plant. Because the claims are the subject of litigation, the city will not be providing any further comment.”
Graham’s legal firm Jenkins Marzban Logan LLP has been contacted by the Peak for comment but has not responded.
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